I asked Derek to contribute this blog to explain some details about Software As A Service or SaaS. It's also referred to as "cloud computing" "infrastructure as a service" (IaaS) and "platform as a service" (PaaS).  Many smaller and medium sized companies have their own server's in-house to manage and run their business and I've been getting an increasing number of questions about "hosting my data somewhere else".  Afterall, Social Media platforms are all hosted in the cloud why not move your business there as well. I think you'll find Derek's blog very useful.  - Bernard Martin

===============================================

As the popularity of software-as-a-service (SaaS) continues to grow in the enterprise, we keep fielding questions from businesses that are curious about SaaS but aren't sure if it's for them. The questions that we hear from businesses aren't very different from common questions that circulate around the term more generally.

In an effort to clear up some of these lingering questions and provide a helpful resource for buyers, and people that are just plain curious, I recently put together a guide to the top 10 frequently asked questions about SaaS. I'd like to share with you the top five that we hear on a consistent basis.

1. Is SaaS A New Form of Software?

While it's only recently that SaaS has taken off, it's hardly a new concept or technology. The first time the concept escaped someones lips was back in 1961 when computer scientist John McCarthy postulated that "computation may some day be organized as a public utility." Of course, the technology didn't come around until the 1990's. But it's not really new given that Salesforce, one of the most successful SaaS companies to date, got it's start in 1999. Since then, the technology has only advanced and the number of solutions multiplied.

2. Who Owns My Data?

This question is one of the most prominent ones and it's completely understandable. Businesses thrive off keeping their information proprietary and have a desire to control that information. However, it's incredibly rare for a vendor to insist that they maintain ownership of your data just because they are hosting it. Ensuring that there are some provisions in your service level agreement (SLA) that spell out in unequivocal terms that you're the owner of your data is a way to make sure it's kept safe. Any vendor that claims they should keep ownership of your data should be avoided at all costs because they are not reputable.

3. How Secure Is My Data?

So you can keep your data safe from vendor ownership, but what about others that may want access to your information? Cases of hacking are few and far between (and just as prominent in on-premise systems). The worry over security of data in SaaS programs is one thing that I still don't quite get. We've had our banking in online SaaS programs for nearly the last decade. If we're Ok with putting personal finances in the cloud, why shouldn't we be comfortable with putting business data in the cloud? Furthermore, most SaaS vendors invest more in security than internal IT programs and undergo extensive security audits under Type II SAS 70 measures.

4. What Happens If My Vendor Fails?

A vendor going out of business is the next question that comes up after the issue of data security has been dealt with. Remember that service level agreement from question 2? That's your best friend when it comes to provisioning for measures of data security, reliability, vendor failure etc. Most vendors have prepaid the datacenters that they run in to stay open in case of business failure. It is usually spelled out in an SLA how you'll get your data back. Make sure there are provisions that explain the type of data export and how much it will cost for a vendor to help with getting your data back.

5. How Do I Choose Between SaaS and On-Premise?

This is a tricky question because no two businesses are the same. In truth, it boils down to the level of complexity present in the business. If you're a manufacturer with fairly straight forward requirements (you make screws all day) then you're going to find all the functionality you need in a SaaS solution. A SaaS solution such as NetSuite or Plex will work just fine. If, however, you are a complex manufacturer that builds highly engineered products (such as equipment for rocket ships) then you will most likely be better served by an on-premise system like SAP Business All-in-One.

These are just a few of the questions and concerns that we hear daily. To check out the rest of the questions that I answer about SaaS, visit my website to find the Software Advice blog over at: What Is SaaS? Frequently Asked Questions About Software as a Service. While you're there, be sure to leave a comment on the blog. Also feel free to add to the list of questions. I'd like for this to become an evolving document and to some day turn this into an HTML 5 directory.